Icahn’s Oil Refiner CVR Starts Unwinding Biofuels Bet

by Jarrett Renshaw and Chris Prentice (Reuters) Carl Icahn’s refining company CVR Energy (CVI.N) has begun buying biofuel credits for the first time in months, a sign the firm is starting to unwind a massive short position in the niche market, according to two sources familiar with the matter.

The company has purchased millions of the credits, known as Renewable Identification Numbers, or RINs, since late August, the sources said. But it will need to buy millions more to meet its obligations under the U.S. Renewable Fuel Standard.

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The company has spread the purchases among different brokers, a second source said, a strategy that will help keep it from attracting sellers looking to bid up the price.

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CVR, in which Icahn owns a majority stake, delayed buying credits for much of the past year in hopes prices would come down, building up a company-record $280 million outstanding obligation by the end of June, according to a Reuters review of company filings.

The move came as Icahn pressured the Trump administration, as an unpaid adviser to President Donald Trump, to revamp U.S. biofuels policy in a way that shifts the blending burden off refiners like CVR further down the supply chain to terminals.

That would have crushed the price of RINs and saved merchant refiners like CVR, Valero Energy Corp (VLO.N) and others hundreds of millions of dollars a year. READ MORE